Intellectual property law is good. Excess in intellectual property law is not. This blog is about excess in Canadian and international copyright law, trademarks law and patent law. I practice IP law with Macera & Jarzyna, LLP in Ottawa, Canada. I've also been in government and academe. My views are purely personal and don't necessarily reflect those of my firm or any of its clients. Nothing on this blog should be taken as legal advice.

This Board
tariff file goes back to 2006 when Netflix was heavily engaged in DVD rental
and smartphones were something new and exciting. In the meantime we have had several
potentially relevant SCC cases on technological neutrality and fair dealing and
new legislation from 2012 that arguably should have had a major impact on this
case.

The
whole technological landscape changed when Netflix launched streaming internet
based video into Canada in September, 2010. Netflix was technically only an
intervenor in the Board case. It is upset that the Board imposed a tariff on
the one-month “free” trial membership that Netflix offers.

Here
is how Netflix is affected by the Board’s tariff:

“For a service that offers
subscriptions to end-users: 1.7 per cent for the years 2007-2010 and 1.9 per
cent for the years 2011-2013 of the amounts paid by subscribers. In the case of
free trials, a minimum monthly fee of 6.8¢ for the years 2007- 2010 and 7.5¢
for the years 2011-2013 per free trial subscriber shall apply;”

Fair
dealing for Netflix is clearly an issue. $0.068 per customer per month for free
trials adds up over the years with as many millions of customers as Netflix has.
Also unresolved and up in the air are issues around “downloads” and “making
available right” – on the one hand, the Board says that SOCAN not entitledbut then the tariff refers to liability for
downloads.

Netflix
started a judicial review (in layperson’s terms, an “appeal”) proceeding on
August 14, 2014. This will take about a year or more to resolve in the normal
course of events. Here is the Notice of Application.For reasons that are not immediately apparent,
Netflix has named the Attorney General of Canada and the Copyright Board itself
as respondents.

Quite
apart from the legal issues, which are interesting enough to say the least, the
whole process raises questions about timing and the role of the Copyright Board
where our copyright oversight regulatory system moves inexplicably slowly but
affects – inevitably retroactively – enormous and innovative industries that
move at the speed of the internet. We have a tariff application here that
started in 2006 at the dawning of the smartphone age and well before the age of
tablets that was decided by the Board eight years later and long after internet
on-demand movies had become widely available. With the almost inevitable judicial
review we now see from Copyright Board decisions, this battle is still far from
over.

This
is another instance in which regulations concerning the procedures and
timelines for Copyright Board hearings might have been helpful.